41814 - Piramal Capital and Housing Finance Limited

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Summary of Investment Information

Project Number

41814

Company Name

PIRAMAL FINANCE LIMITED

Date SPI Disclosed

Apr 8, 2019

Country

India

Region

South Asia

Projected Board Date

May 20, 2019

Environmental Category

FI-3 - No Impact

Status

Completed

Last Updated Date

Feb 13, 2025

Department

Regional Industry - FIG Asia & Pac

Industry

Financial Markets

Previous Events

Approved : May 31, 2019
Signed : Jun 6, 2019
Invested : Jun 14, 2019

Sector

Primary Mortgage Institutions

Project Description

The proposed investment comprises s senior debt investment in Piramal Capital & Housing Finance Limited (“PCHFL” or the “Company”), a housing finance company (“HFC”). PCHFL provides a range of products in the real-estate sector for both wholesale and retail segments. In addition to this the Company also provides corporate finance loans for companies in the infrastructure sector and small-medium-enterprise loans for emerging corporates. PCHFL is the financials services arm of the Piramal Group which is a US$11 billion conglomerate engaged in sectors such as healthcare & pharmaceutical, real-estate and financial services.

As of December 31, 2018, PCHFL has an asset base of INR540 billion (US$7.7 billion) and loan portfolio of INR417 billion (US$6 billion). The proposed IFC debt facility will enable PCHFL to expand its affordable home loan (retail) portfolio.

Associated Advisory Engagement

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	150.85
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Straight Senior Loan	Housing Finance
Straight Senior Loan	Housing Finance

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

1. Financing Structure (long tenor): IFC's US$150 million of credit line with a tenor of 5 years would help PCHFL in their endeavor to diversify their long-term sources of funds and access the international market. 2. Resource Mobilization: IFC's acting as an anchor investor to syndicate up to an additional US$200 million will help the Company's positioning in the foreign market. 3. Trusted partnership: IFC's investment in the housing finance sector, which has been negatively impacted by liquidity constraints in recent past, will signal IFC's continued confidence in the sector and is likely to support its normalization.

E&S Category Rationale / Risks and Mitigation

The lending profile of PCHFL comprises long term project and corporate financing, as well as short term financing solutions to medium and large corporates in various industry segments. It also provides construction finance to real estate developers and retail home loans to individual borrowers for purchase (or self-construction) of houses. IFC's loan and the parallel loan will be utilized only for individual retail home loans portfolio. The proceeds will not be used to support any coal-related activities, or higher risk business activities that may include significant Occupational Health and Safety risks or impacts on the environment, community health and safety, biodiversity, cultural heritage, involuntary resettlement or risk of adverse impacts on Indigenous Peoples. Hence, the proposed debt facility presents no adverse environmental or social risks or impacts the project is categorized as FI-3 in accordance with IFC's Environmental and Social Sustainability Policy. Given the nature of activities to be supported there is no need for establishing ESMS. The company's HR policies and practices are in line with IFC PS-2 requirements.

Contacts

For Inquiries About the Project, Contact

Piramal Capital & Housing Finance Limited
Ms. Dimple Kapur
Group Head Branding & Corporate Communications
+91 22 61513400
dimple.kapur@pirmal.com
Lower Parel West, Lower Parel, Mumbai 400013
http://www.piramal.com/contact-us/enterprises

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Fax: 202-974-4384

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This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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